Nairobi Securities Exchange
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trillion/= 24 October 2014[2] | |
Indices | NSE All Share Index NSE 20 Share Index FTSE NSE Indices FTSE NSE Kenya 15 Index FTSE NSE Kenya 25 Index FTSE NSE Kenya Govt. Bond Index FTSE ASEA Pan African Index |
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Website | NSE.co.ke |
The Nairobi Securities Exchange (NSE) was established in 1954 as the Nairobi Stock Exchange, based in
History
Founding Nairobi Stock Exchange (1954-1999)
The Nairobi Stock Exchange was established in 1954 as the in
Since Africans and Asians were not permitted to trade in securities, until after the attainment of
In 1996 saw the largest share issue in the history of NSE with the privatization of
Expansion (2000–2005)
NSE implemented a new trading cycle, (T+5) in August 2000. The Central Depository System Act (CDS) and the amended CMA Act covering Collective Investment Schemes (CIS) were passed by
In April 2002 CMA announced the approval of the new NSE trading and settlement rules. The amount for block trades was revised upwards from Kshs. 3.0 million to between KSh.50 – 200 million/=. The block trade rules now applied to trade values above KSh.50 million/= but less than KSh.200 million/=. Lastly, the brokerage commissions’ regime was liberalized. July 2002 saw the foreign investor regulations amended, providing for a 25% minimum reserve of the issued share capital for Kenyan citizens, while the balance of the 75% becomes a free float for all classes of investors. Within this 75% share holding available to all classes of investors, there is no restriction on the amount to be held by a single foreign investor. The signing of the shareholders’ agreement for the Central Depository and Settlement Corporation (CDSC) was done in August 2002. The shareholders consisted of the Nairobi Stock Exchange (20%), the Association of Kenya Stockbrokers (18%), the CMA Investor Compensation Fund (7%), and 9 institutional investors through the Capital Markets Challenge Fund (50%) who collectively invested in the CDSC. The CDSC being the legal entity that owns and runs the clearing, settlement, depository and registry system for securities traded in Kenya's capital markets. As of November 2002, the NSE became the sole NNA in Kenya, responsible for allocating the unique code for quoted and unquoted securities domiciled in Kenya.[citation needed]
In March 2003 the CDSC in collaboration with the NSE commenced the CDS Education Campaign in preparation for the market automation. The first CDS Education Workshop, with the theme "The CDS Legal & Regulatory Framework" kicked off. The NSE celebrated its Golden Jubilee in 2004, and also hosted the 8th ASEA conference. In this celebration, the first NSE magazine dubbed "The Exchange" and, The Central Depository & Settlement Corporation (CDSC), which manages Central Depository Systems, were both launched. For the year ending 31 December 2003, the exchange recorded an equity turnover exceeding KSh.15.25 billion/=, more than the combined equity turnover recorded in the previous five years. For the year ending 31 December 2004, the exchange recorded an equity turnover exceeding KSh.22.32 billion/=; an increase of 46.37% over the corresponding period for 2003. For the year ending 31 December 2005, the exchange recorded an equity turnover exceeding KSh.36.52 billion/= (a 63.61% increase over the previous year's performance of Kshs. 22.32 billion).[citation needed]
New technologies and indices (2006–2010)
In May 2006, NSE formed a
An MoU between the Nairobi Stock Exchange and Uganda Securities Exchange was signed in November 2006 on mass cross listing. The MoU allowed listed companies in both exchanges to dualist, to facilitate growth and development of the regional securities markets. In February 2007 NSE upgraded its website, in part to boost data vending business. In July 2007 NSE reviewed the Index and announced the companies that would constitute the NSE Share Index. The review of the NSE 20‐share index was aimed at ensuring it is a true barometer of the market. A wide area network (WAN) platform was implemented in 2007; this eradicated the need for brokers to send their staff (dealers) to the trading floor to conduct business. Trading is now mainly conducted from the brokers' offices through the WAN. However, brokers under certain circumstances can still conduct trading from the floor of the NSE.[citation needed]
In 2008, the NSE All Share Index (NASI) was introduced as an alternative index. Its measure is an overall indicator of market performance. The Index incorporates all the traded shares of the day. Its attention is therefore on the overall market capitalization rather than the price movements of select counters. In April 2008, NSE launched the NSE Smart Youth Investment Challenge to promote stock market investments among Kenyan youth.[citation needed] The objective of the challenge was threefold:
- To occupy the minds of the youth positively and draw them away from the negative energy created by the current political, economic and social situation in the country;
- Encourage the culture of thrift and saving funds amongst the university students;
- Encourage the youth to invest their savings in the capital markets.
After the resignation of Chris Mwebesa, the NSE board appointed Peter Mwangi to be the new NSE chief executive in November 2008. The Complaints Handling Unit (CHU) was launched in August 2009 to bridge the confidence gap with NSE retail investors and have any concerns processed and resolved. Also in 2009, NSE launched the Complaints Handling Unit (CHU) SMS System. The Nairobi Stock Exchange marked the first day of automated trading in government bonds through the Automated Trading System (ATS) in November 2009. The automated trading in government bonds marked a significant step in the efforts by the NSE and CBK towards creating depth in the capital markets by providing the necessary liquidity. In December 2009, NSE marked a milestone by uploading all government bonds on the ATS.[citation needed]
Nairobi Securities Exchange (2011–2022)
In July 2011, the Nairobi Stock Exchange Limited, changed its name to the Nairobi Securities Exchange Limited. The change reflected the NSE's strategic plan to become a full service securities exchange supporting trading, clearing and settlement of equities, debt, derivatives and other associated instruments. In the same year, the equity settlement cycle moved from the previous T+4 settlement cycle to the T+3 settlement cycle. This allowed investors who sell their shares to get their money three days later, while buyers have their CDS credited at the same time. In September 2011 the Nairobi Securities Exchange converted from a company limited by guarantee to a company limited by shares and adopted a new Memorandum and Articles of Association reflecting the change. In October 2011, the Broker Back Office system commenced operations, which facilitates internet trading. In November 2011 the FTSE NSE Kenya 15 and FTSE NSE Kenya 25 Indices were launched, after NSE consulted local asset owners and fund managers, focusing on diverse domestic investment in East Africa. In March 2012 the delayed index values of both new indices were made available on the NSE website www.nse.co.ke.[citation needed]
The NSE became a member of the Financial Information Services Division (FISD) of the
The NSE added two new listings in November 2014, the Flame Tree Group,
The bourse had 66 listed companies in February 2021.
Types of indices
These include:
- NSE 20 Share Index- Mean of top 20 performing companies under a certain review year
- NSE 25 Share Index- designed to represent performance of Kenyan companies listed in the NSE
- NSE All Share Index (NASI)
- FTSE NSE Indices
- Chuley
Regional integration
NSE is a member of the African Securities Exchanges Association, East African Securities Exchanges Association and an affiliate member of World Federation of Exchanges.
Market listings
Subsidiaries and investments
Other than stock and bond trading as the main business of the NSE, the exchange has the following investments:[28]
- NSE Clear Limited - 100% Shareholding - Nairobi, Kenya - Provision of clearing house services for the derivatives/futures exchange.
- Central Depository and Settlement Corporation Limited - 22.5% Shareholding - Nairobi, Kenya - Provision of clearing, settlement and depository services.
Governance and ownership
Nairobi Securities Exchange, as of 2015, was governed by an eleven-person Board of Directors with Kiprono Kittony serving as the chairman of the group and Geoffrey Odundo as the CEO.[29]
The shares of the Nairobi Securities Exchange are listed and traded on its own main board, under the symbol NSE. As of 31 December 2014[update] the shareholding in the bourse's stock were as depicted in the table below:[29]
Rank | Owner | Percentage ownership |
---|---|---|
1 | Standard Chartered Kenya Nominees | 21.75 |
2 | CfC Stanbic Nominees Kenya Limited | 7.67 |
3 | Cabinet Secretary, Treasury of Kenya | 3.37 |
4 | Investor Compensation Fund Board |
3.37 |
5 | Other | 63.84 |
Total | 100.00 |
See also
- Economy of Kenya
- List of African stock exchanges
- List of stock exchanges in the Commonwealth of Nations
- List of stock exchanges
References
- ^ "Nairobi Securities Exchange (NSE) Live". afx.kwayisi.org. Retrieved 17 June 2018.
- ^ NSE Equity Daily Statistics
- ^ 2016 Nairobi securities exchange annual and financial statement report
- ^ a b "Welcome to the official web site of The Nairobi Stock Exchange". Archived from the original on 17 August 2000.
- ^ "Nairobi securities exchange". Annual Report: 9. 2017 – via annual report 2016.
- ^ a b "Nairobi Securities Exchange expects four new company listings in 2021 - CEO". Reuters. 16 February 2021.
- ISBN 978-1-405-36937-4.
- ^ Editor, Nairobian. "Shares were traded from this bar floor at The Sarova Stanley hotel". Standard Digital News. Retrieved 13 August 2018.
{{cite web}}
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has generic name (help) - ^ History of the Nairobi Securities Exchange
- ^ "Nairobi Securities Exchange - NSE Kenya" (PDF). www.nse.co.ke. p. 29. Retrieved 29 May 2020.
- .
- ^ Agencies, ANNA Association of National Numbering. "Association of National Numbering Agencies (ANNA)". Association of National Numbering Agencies (ANNA). Retrieved 29 May 2020.
- ^ Biekpe, Nicholas. "African Markets Overview" (PDF). AFRICAN MARKETS OVERVIEW October 2000: 32.
- ^ Millennium IT. "Live Trading commences at Nairobi Stock Exchange". millenniumit.com. Archived from the original on 3 December 2008. Retrieved 28 June 2007.
- ^ NSE set to sell shares to public on 24 July
- ^ "IPO oversubscribed by 764 pc, says NSE". The People Daily. Mediamax Network. 4 September 2014. Archived from the original on 9 September 2014. Retrieved 9 September 2014.
- ^ "NSE IPO Oversubscribed". Citizen TV. 2 September 2014. Archived from the original on 10 September 2014. Retrieved 9 September 2014.
- ^ "NSE value rises to Sh3 billion on first day of trading". Business Daily. Nation Media Group. 9 September 2014. Retrieved 9 September 2014.
- ^ Wahito, Margaret (6 November 2014). "Kenya: Flame Tree Group Enters Bourse Via Gems". All Africa. Capital FM. Retrieved 8 November 2014.
- ^ "Kurwitu Ventures to list on GEMs at Sh1,250 a share". Business Daily. Nation Media Group. 10 November 2014. Retrieved 12 November 2014.
- ^ "CMC Holdings Delisted From Nairobi Securities Exchange". Business Daily Africa (Nairobi). 12 February 2015. Retrieved 12 February 2015.
- ^ "Nairobi Securities Exchange Joins United Nations Sustainable Stock Exchanges Initiative". SSE Initiative. SSE. Retrieved 12 March 2015.
- ^ "Kenyan stock exchange promotes transparency in capital markets". Coastweek. Xinhua News Service. Retrieved 18 March 2015.
- ^ "Nairobi Securities Exchange eyes acquisitions among other African bourses". 25 April 2022.
- ^ Nyawira, Susan (9 December 2022). "Kenya: NSE Links with Seven African Capital Markets". Capital Fm.
- ^ "How fractional share ownership will work". 4 December 2022.
- ^ "Foreign investors trading at NSE halves in one week". 6 December 2022.
- ^ "Nairobi Securities Exchange IPO Prospectus" (PDF). Nairobi Securities Exchange. 9 July 2014. Retrieved 31 December 2014.
- ^ a b "Nairobi Securities Exchange 2015 Annual Report". Nairobi Securities Exchange. 31 December 2015. Retrieved 18 January 2016.